The Analysis Of Household Purchasing Behavior Based On Micro Consumption Data

With the increasingly fierce competition in the consumer goods market, more and more promotional strategies have been adopted. Among them, the issue of coupons has been emphasized for a long time. One reason is that the coupon does not only provide discounts, but also can play the role of advertising. More importantly, by distributing coupons, manufacturers can charge different prices to consumers with different willingness to pay, in order to achieve price discrimination and to gain higher profits. Therefore, how to develop a coupon distribution strategy is a problem worthy of study.Several previous studies have shown that the heterogeneity of consumer preferences of coupons. Gender, education, income family structure and other factors will impact the use of coupons A bunch of research to explore this issue by questionnaires, but the conclusions are not the same.In this paper, we investigate the breakfast cereal market in the United States to study the factors that influence consumers to use coupons. The breakfast cereal market is an oligopolistic market. Several major manufactures compete with each other by heavy adverting and coupon promotion in the market, and it provides a ideal object to researchers. This paper describes the history of the development of the breakfast cereal industry and the background knowledge of coupon as a promotional tool. Then, it reviews some relevant literatures. In the analysis part, we use a fixed effect model and a two-stage Heckman model to implement an empirical analysis on the U.S. breakfast cereal market by scanner data.The first step of the Heckman correction is running a PROBIT regression to obtain the fitted value of the probability of consumers choosing whether to use coupons and to calculate the inverse Mills ratio. The second step is including the inverse Mills ratio as an additional variable into the regression estimation, and calculating the standard errors by bootstrap method.The empirical results show that despite the current tendency of entering the labor force, women still bear the main responsibility in terms of shopping.83%of the home shopping is dominated by women. Income, race, education and employment status have no significant impact on using coupons in breakfast cereal market, but age and total expenditure have positive impact on coupons. Gender also has a significant effect on coupon usage. The fixed effect model shows that female redeems5.6cents more coupons than males when they are purchasing cereals each month. This is a18.7%higher for women than man in terms of coupon value and a4%higher in terms of using frequency. Due to the existence of sample selection error, here we adopt a two-stage Heckman model to deal with this problem. The coefficient of the inverse Mills ratio is significantly different from0, which indicates that there should be a sample selection problem. After this correction, the significance of estimates is not changed. The standard errors and the value of coefficients become smaller. This means the sample selection problem induces upward bias into the estimates. These empirical results have some marketing implications.